Linde AG posts higher sales, continues see growth

Linde AG posts higher sales, continues to see growth

1:04 PM, 17th June 2011
Linde AG posts higher sales, continues to see growth

  • Sales grow 14.9 per cent to € 3.325 billion
  • Operating profit increases at a faster rate than sales, by 18.7 per cent to € 761 million
  • Operating margin up 80 basis points to 22.9 per cent
  • Outlook for 2011 confirmed: growth in sales and earnings expected

MUNICH, GERMANY: The Linde Group has made a good start to the new financial year, achieving significant increases in group sales and operating profit in the first three months of 2011. The group sales rose by 14.9 per cent to € 3.325 billion, compared with sales for the first quarter of 2010 of € 2.894 billion. Linde has continued to improve its profitability, achieving an 18.7 per cent increase in group operating profit to € 761 million (2010: € 641 million). Operating profit has increased at a faster rate than sales. The group operating margin was 22.9 per cent, 80 basis points above the figure for the comparable prior-year period of 22.1 per cent.

Earnings before taxes on income (EBT) rose significantly, by 40.3 per cent to € 397 million (2010: € 283 million). Earnings after tax increased by 42.3 per cent to € 303 million (2010: € 213 million). The earnings attributable to Linde AG shareholders were € 284 million (2010: € 198 million), giving earnings per share of € 1.67 (2010: € 1.17).

“We have again seen profitable growth and are well on the way to achieving our targets. We confirm our Group outlook and expect to achieve higher levels of Group sales and Group operating profit in the 2011 financial year than in 2010,” said Professor Dr Wolfgang Reitzle, CEO, Linde AG.

“We are well-positioned and will take full advantage of the opportunities available, especially in the environmental and energy sectors, the growth markets of Asia and the medical gases business,” said Reitzle.

The improvement in the economic situation in the first quarter of 2011 also resulted in rising demand in the worldwide gases business. Sales in the gases division in the first three months of 2011 grew 13.8 per cent to € 2.662 billion, compared with the figure of € 2.340 billion for the first quarter of 2010. The growth in operating profit of the gases division of 16.3 per cent to € 727 million (2010: € 625 million) once again outpaced the increase in sales. The operating margin improved by 60 basis points to 27.3 per cent (2010: 26.7 per cent).

The performance in the individual product areas reflects the overall positive trend in the gases division in the first quarter of 2011. Linde remains committed to its original target in the gases business of growing at a faster pace than the market and continuing to improve productivity. The company anticipates that sales generated by the gases division in the 2011 financial year will exceed sales achieved in 2010 and that operating profit will grow at a faster pace than sales.

The market environment in the international large-scale engineering business continued to stabilise in the first quarter of 2011. Sales in the engineering division in the first quarter of 2011 increased by 14.3 per cent to € 591 million (2010: € 517 million). The successful execution of a number of individual projects meant that operating profit grew at a faster rate than sales, rising 21.6 per cent to € 62 million (2010: € 51 million). The operating margin was 10.5 per cent (2010: 9.9 per cent), again significantly exceeding the target figure of 8 per cent.

Linde’s order backlog remains high. At 31 March 2011, it stood at € 3.714 billion (31 December 2010: € 3.965 billion). The high order backlog provides a good basis for a solid business performance in the engineering division over the next two years. The target figure for the operating margin in the current financial year is at least 8 per cent. Linde continues to be well-positioned in the international market for olefin plants, natural gas plants, air separation plants as well as hydrogen and synthesis gas plants and will derive sustainable benefit in particular from investment in two structural growth areas: energy and the environment.

(C) WOC News

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